Silver Set for a Rally

Online, June 11, 2013 (Newswire.com) - As precious metal investors run for cover after experiencing massive losses in gold and silver, June may be a good time to get back into silver. Spot the point of maximum pessimism in any market and you have the best point of entry. At $21.5 an ounce, silver could certainly yield impressive returns over the coming months. After plummeting more than 30% from its January highs, technical indicators suggest that the gray metal is due for a rally.

Historically silver prices are lowest in June and recover through the end of the year. Though this is no guarantee that silver will recover, it is highly likely that the bottom is very near its current trading range between $21 and $22 per ounce.

Sonata Financial analysts have watched the demise of gold and silver very closely, and though gold still may have a way to fall before recovering, analysis indicates that silver is very near bottom. Strong support for silver at its current trading levels and an intact uptrend both hint at a strong recovery in the coming months.

The demand for physical silver is far greater than investment supply compared to gold. In recent weeks, for every one ounce of gold purchased nearly 50 ounces of silver have been snatched up. Compared to the ratio of available supply which is only 3 to 1, this indicates strong demand and an imminent rally for silver compared to gold.

With all of this considered, there could be a shortage of silver in coming months driving prices skyward.